Insurance can be described as any form of protection from financial losses. For insurance to work the insurer and insured must be present, the crucial work done by the insurer is to sell the insurance cover while the insured has to buy that insurance cover. An agreement between these two parties that the insured will pay the insurer some agreed amount of money for a period of time and the insurer then will compensate him if any unexpected calamity occurs that leads to loss financially.
The most common types of insurance include flood insurance, landlord and renters insurance, motorbikes and scooters insurance, home insurance, business insurance, personal items insurance among others. The rising cost of living has made it necessary for people to take up insurance for fear of loss of whatever they have built up.
The type of insurance responsible for the personal residence of an individual is called home insurance or commonly as homeowner’s insurance cover. Most importantly, the homeowners insurance policy covers the home itself, all its contents plus all losses that may result as a consequence of a disaster such as floods or earthquakes. Many people work very hard to support their families and the knowledge that whatever calamity comes along, their family members will always have a home makes these individuals feel at peace.
On the other hand, life insurance refers to the contract taken between the assurer and the assured that the assurer will pay a selected beneficiary a sum of money if the assured keeps making regular payments to the assurer. In the event that the assured actually passes on, then there will be no worries like burdening the assured relatives as the assurer will release the funds as agreed to take care of the children’s needs. In addition, the policy may be used as collateral in acquiring huge loans for purposes that the assured deems important enough.
Lastly, insurance taken for road vehicles such as cars, trucks, motorcycles and buses is usually referred to as auto, car, motor or vehicle insurance. The basic use of this type of insurance is to provide protection in financial terms against any physical damage resulting from traffic collisions. Financial protection is also offered when physical damage occurs to the vehicle as a result of theft after the occurrence of the accident.
To protect themselves against all kinds of disasters and calamities present, awareness should be created about the excellent services insurance provides to its users. Insurance could also be used as a saving tool in the sense that the assured may agree with the assurer that he will receive cash after sometime after payment of premiums instead of the premiums being paid out after his death. Insuring your properties is the best way to protect them.